Fulton County Superior Court has fined Atlanta City Councilman H. Lamar Willis $25,000 for not registering his foundation as a charitable organization as well as not properly maintaining financial records for it.
Willis also cannot solicit or accept charitable contributions, nor can he help anyone else do so, unless there's proof of an exemption.
"Mr. Willis not only broke Georgia law, but his actions represent a severe breach of ethics and the trust that contributors placed in him," Georgia Secretary of State Karen Handel said in a statement. "Those who manage charitable organizations must operate within the law and with the highest degrees of ethics and transparency."
The action was brought by Handel, who oversees all charities in the state.
The fines stem from a 2007 Atlanta Journal-Constitution investigation into financial irregularities with Willis’ self-named foundation.
The newspaper found the councilman raised tens of thousands of dollars from area corporations for years while claiming the H. Lamar Willis Foundation, a scholarship foundation, was a federally approved tax-exempt organization.
It wasn’t. The Internal Revenue Service said the foundation never applied for tax-exempt status and never filed mandatory annual financial reports. The foundation also never registered as either a charity or a nonprofit group with the Georgia Secretary of State, as required by law.
In the past, Willis claimed he had raised about $150,000 for scholarships. Now, Handel stated Willis had raised about $300,000.
Calls to Willis' council offices and cellphone were not returned. His law office telephone was disconnected.
In September 2007, Willis told the AJC that a lawyer and an accountant were reviewing his finances and he would make their findings public.
To this date, Willis has made no public accounting of the defunct foundation’s finances.
Last month, the AJC reported Willis, running for a third term this year, owes thousands in state taxes. Willis, who has held an at-large citywide post since 2002, owes almost $44,000 in back taxes and fines — and that’s after the state garnisheed his and his wife’s wages for the past year to pay off more than $11,000 in back taxes.
The liens also stem from Willis’ alleged charity. In 2008, the state Department of Revenue filed two liens against Willis, one for $42,335 in unpaid corporate taxes for the foundation, and one for $11,308 in personal taxes.
The state said the liens were for unpaid taxes for the years 2002 to 2006. The corporate tax lien has not been paid, but the state garnisheed the councilman’s wages and his wife’s to satisfy the personal tax debt. On Aug. 28 , the state filed a new lien against Willis, this time for sales taxes of $1,560.16. The state is asserting Willis purchased a vehicle in 2005 and did not pay state sales tax.
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